CHAPTER-3

SERVICE QUALITY

3.1 Meaning of Quality

In its broadest sense, quality is a degree of excellence: the extent to which
something is fit for its purpose. In the narrow sense, product or service quality
is defined as conformance with requirement, freedom from defects or
contamination, or simply a degree of customer satisfaction.

In quality management literature, quality is defined as the totality of

characteristics of a product or service that bears on its ability to satisfy stated
and implied needs.

Crosby (1979) defined quality of goods as “conformance to requirements”;

Juran (1980) defined it as “fitness for use”; while Garvin (1983) measured
quality by counting the incidence of “internal” failures (those observed before a
product left the factory) and “external” failures (those incurred in the field after
a unit had been installed).

Gronroos (1990) has noted that product quality was traditionally linked to the
technical specifications of goods, with most definitions of quality arising from
the manufacturing sector where quality control has received extensive attention
and research. The product-based definitions of quality may be appropriate to
the goods-producing sector; however, according to Parasuraman and others,
knowledge about the quality of goods is insufficient to understand service
quality (Parasuraman et al., 1985).

Kotler and Armstrong (1996) have defined service quality as “the totality of
features and characteristics of a product or service that bear on its ability to
satisfy stated or implied needs”.

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3.2 Characteristics of Services
According to Wilson et al. (2008), services are usually discussed in terms of its
distinctive characteristics. These four unique characteristics are as follows:
1. Intangibility: Services that cannot be seen, touched, smelled or tasted.
2. Inseparability: Services are generally produced and consumed
simultaneously. Usually the provider and consumer are present when the
service is being provided, so both are part of the service process. They
cannot be separated from service.
3. Heterogeneity: The quality of services cannot be consistent as they are
performed by different employees and at varying time intervals. It is
difficult to reproduce services of the same standards, as can be done
with products, because they are produced by people.
4. Perishability: Service cannot be stored like products, at the same time;
services cannot be returned or resold.

3.3 Meaning of Service Quality

Quality in a service is a measure of the extent to which a delivered service
meets the customer’s expectations. It is determined by the customer’s
perception and not by the perceptions of the providers of the service. Service
quality is considered a critical determinant of competitiveness. Service quality
can help to differentiate itself from other competitors and gain a competitive
advantage. Superior service quality is a key to improved profitability. Services
are an important segment of all economies and they become increasingly more
a part of everyday life as economies develop. Consumer service is a key factor
towards generating loyal retail customers, and ultimately, successful retail
businesses. Defined as an activity that supplements or facilitates store sales,
consumer service includes such items as free parking, gift wrapping,
environment and delivery. Additionally, sales personnel offer consumer service
through their interactions and relationships with customers. Nature and extent
of Service Quality is dependent upon certain identifiable factors or dimensions
which can be optimized with wise managerial judgments.

31
 Figure 3.1

Gronroos (1984, p. 38) defined service quality as a perceived judgment,

resulting from an evaluation process where customers compare their
expectations with the service they perceive to have received. According to him
service quality issues could be split into technical quality (what is done) and
functional quality (how it is done).

Parasuraman et al. (1988, p. 17) defined service quality as “the degree of

discrepancy between customers’ normative expectations for the service and
their perceptions of the service performance”. Perceived service quality is then
interpreted from the differences in degree and direction between perceptions
and expectations.

Service quality has drawn attention of researchers and managers in recent

decades (Zeithaml, 2000). It has become a significant subject because of its
impact on customer satisfaction. Service quality is the measure of customer

32
satisfaction and customer delight. By satisfying customers through high quality
service, business firms not only retain their current customers, but also increase
their market share (Finn and Lamb, 1991). To date, many studies on service
quality relied on service quality construct and scale (Parasuraman et al.,1988).
However, this application to the retail industry may not be appropriate for
service quality in retailing industry seems to be different from other services
(Kaul, 2005; Dabholka et al, 1996). In retail setting, especially retail stores
where there is a mix of product and service, retailers are likely to have impact
on service quality more than on product quality (Dabholkar et al., 1996).
Service quality in retail outlets is different from other product or service
oriented organizations (Finn, 2004). This is because of the unique nature of
retail organizations which offer both goods and services.

Service quality is considered as a vital measure to increase the customer

satisfaction towards the retail store and in turn helps the store to position its
service in the minds of the customers. Various service quality measurement
techniques are used by the retailers to find out the exact level of satisfaction of
customers towards their service offering. Research indicates that customers’
satisfied with service quality are most likely to remain loyal (Wong and Sohal,
2003). Because of change in business environment, Indian customers are
expecting more quality service (Angur, Nataraajan and jahera, 1999) and
retailers can no longer afford to dissatisfy the customers in service issues (Firoz
and Maghrabi, 1994). Service quality is considered a tool to increase the brand
image of the store and act as a positioning tool (Mehta, Lalwani and
Han,2000). Service quality ensures customer satisfaction (Boulding et al, 1993)
high revenues, increased customer retention and leads to repeat customer
purchase behaviour (Cronin and Taylor, 1992) which ultimately increases the
market share of the retailer. According to Gagliano and Hathcote (1994), retail
services are classified into “Store Services”, the extent to which variety, quality
and dependability of service can be obtained, and “Sales Service”, the extent to
which prompt and individual service attention can be achieved. So it is

33
imperative that retailers should concentrate on both store and sales service to
get an overall service quality objective. Today’s business environment is
becoming increasingly hostile and intense competition from both domestic and
foreign companies leads to greater expectation from the customers. Service
organizations strive to maintain a superior quality of service in an effort to gain
customer loyalty (Zeithaml, 1988), therefore, long term success of a service
organization is essentially determined by its ability to capture and retain a wide
customer base.

Ever since the liberalization move in 1990’s, Indian economy witnessed a steady
economic growth. With the beginning of new millennium, India was considered
as an emerging super power and in 2009, Indian GDP based on purchasing
power parity (PPP) stood at USD 3.5 trillion making it as the fourth largest
economy in the world. AT Kearney, the well-known international Management
Consultancy recently identified India as the “second most attractive retail
destination” globally from among 30 emerging markets. Given the opportunity
in the organized retail in India, it is imperative that the retail stores should
understand the customers’ expectation on service quality of stores. Concept of
Service Quality Marketing research states that customers satisfied with the retail
store’s service are most likely to remain loyal to the store.

The subject of service quality has aroused considerable recent interest among
business people and academics. Of course, buyers have always been concerned
with quality, but the increasing competitive market for many services has led
consumers to become more selective in the services they choose.
Conceptualizing the quality for services is more complex than for goods.
Because of the absence of tangible manifestations, measuring service quality
can be difficult.

3.4 Customer Retention through Quality Improvement

The focus of the modern marketers has shifted away from a one-time sale to
making repeated sales to the same customer. Increasing attention is being paid

34
to medium and long term perspectives, rather than just the short-term
perspective. This has been a major revolution in the field of marketing. If the
customer remains loyal to the company, naturally, the repeated purchases
represents a cumulative value which is quite substantial compared to any single
transaction. Therefore, the focus of marketing has shifted away from the goal
of mere customer acquisition to customer retention in order to substantially
reduce marketing costs.

The key differentiator between customer retention is customer satisfaction.

Satisfaction results when the customer feels that the value of a service received
by him is substantially higher than the price he paid for acquiring the service.
Customer satisfaction can be largely attributed to the quality of the service or
product. Thus, delivery of high quality service is crucial to the high service
value perception. When the major marketing goal of a company is customer
retention, the quality of service delivery is, undeniably, the key differentiator.

3.5 Models for Measuring Service Quality

The measurement and management of service quality is more challenging as
compared to tangible products.

3.5.1 Service Quality Scale (SERVQUAL)

Service quality is defined as ‘a global judgment or attitude, relating to the
overall superiority of the service’ (Parasuraman, Zeithaml and Berry, 1988).
The SERVQUAL proposes a gap based conceptualization of service quality
where the gap indicates the extent to which the service obtained confirms to
expectations. In SERVQUAL, both - store service performance and consumer
expectations of the store service, are explicitly measured to assess the ‘gap’.
Conceptually, this gap assessment assumes that the statement of desired
attribute levels is the yardstick a consumer uses to assess store service
performance (Carman, 1990). Schnieder and White (2004) provide a list of
several other yardsticks which can be used by a consumer to evaluate store
service delivery. Even empirically, several researchers find the performance

35
perceptions to be sufficient in assessing service quality as compared to the gap
(Carman, 1990; Angur, Nataraajan and Jahera, 1999).

Evaluation of service quality involves a comparison of customers’

expectations of the service before it occurs with their perceptions of the service
after the encounter (Parasuraman et al., 1985). Thus, the SERVQUAL scale
comprises of two sets of matched items measuring expectations and
perceptions.

Based on the “perceived service quality”, scholars have done exploratory study
on measuring the service quality. The first study on the service quality
characteristics was conducted by British Airways in 1980, the study found
some factors that influenced customer perceived quality, which included care
and understanding, responsiveness, problem-solving abilities, ability to
remedy. In 1980s in the attempt to define service quality and develop a model
of service quality, Parasuraman et al. conducted an exploratory investigation.
The results showed that regardless of the type of service, consumers used
basically similar criteria in evaluating service quality (Parasuraman et al.,
1985). Subsequently, A. Parasuraman, Leonard L Berry,Valarie A. Zeithaml
(in short, PBZ) (1985) presented the gaps-model and the 10 factors that affect
the service quality; responsiveness, competence, accessibility, courtesy,
communication, credibility, security, understanding, the physical evidence,
containing 97 test items totally. At the same time they proposed that further
empirical research is needed about these factors and project. In 1988, through
two stages of empirical research, A. Parasuraman, Leonard L Berry, Valarie A.
Zeithaml condensed the scales pool from 97 items to 54 items, and later
reduced to 34 items, finally resulted in 22 items with 5 dimensions, the five
dimensions are: tangibility, reliability, responsiveness, assurance (competence,
courtesy, credibility, security) and empathy (comprehension, communication),
thus formed a widely used SERVQUAL scale. This model indicates that
consumer perceptions of quality are influenced by five gaps occurring in the
internal process of service delivery.

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 SERVQUAL DIMENSIONS

1. Providing services as promised.

2. Dependability on handling customer’s service problems.
Reliability 3. Performing services correctly the first time.
4. Providing services at the promised time.
5. Maintaining error-free records.
6. Keeping customers informed about when services will be
performed.

Responsiveness 7. Prompt service to customers.

8. Willingness to help customers.
9. Readiness to respond to customer’s requests.
10. Employees who instill confidence in customers.
11. Making customers feel safe in their transactions.
Assurance 12. Employees who are consistently courteous.
13. Employees who have the knowledge to answer customer
questions.
14. Giving customers individual attention.
15. Employees who deal with customers in a caring fashion.
Empathy 16. Having the customer’s best interest at heart.
17. Employees who understand the needs of their customers.
18. Convenient business hours.
19. Modern equipment.
20. Visually appealing facilities.
Tangibility
21. Employees who have a neat, professional appearance.
22. Visually appealing materials associated with the service.

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 Figure 3.2

The scale is considered having good reliability and validity, and can be used to
improve service quality. Also, it can examine the service quality trend; it can
assess the particular enterprise’s service quality even each dimension and the
final quality. Different dimensions have different influence on quality
perception. Later, A. Parasuraman, Leonard L Berry, Valarie A. Zeithaml
(1991) improved and re-evaluated the scale, changed the description of some
items, changed the statement sentences from negative tone into positive tone,
although having done much improvements, A. Parasuraman, Leonard L Berry,
Valarie A. Zeithaml still emphasized the SERVQUAL scale is the basic
“skeleton” but not the perfect one, the scale should be modified when being
applied in different service settings.

SERVQUAL was developed by measuring the service quality in diverse

setting, including an appliance repair and maintenance firm, several retail
banks, a long distance telephone provider, a security broker, and credit card
companies, as the authors intended to develop and design a scale which could
be used for measuring service quality across service environments. Several

38
studies subsequently employed SERVQUAL to measure service quality and to
assess the validity and reliability of the scale across a wide range of industries
and cultural contexts (Carman, 1990; Finn and Lamb, 1991; Gagliano and
Hathcote, 1994;Blanchard and Galloway, 1994; Mittal and Lassar, 1996;Zhao,
Bai and Hui, 2002; Witkowski and Wolfinbarger,2002; Wong and Sohal,
2003). The Service Quality (SERVQUAL) scale has been widely used to
measure service quality in different service contexts, such as professional
services (Freeman and Dart, 1993), health care (Lam, 1997), tourism (Tribe
and Snaith, 1988), business school (Pariseau and Mc Danieal, 1997) and
information systems (Kettinger and Lee, 1994). It has also been widely tested
for its validity and reliability (Bolton and Drew, 1991; Cronin and Taylor,
1992,1994). SERVQUAL has been subsequently adapted and used in a variety
of settings like the hospital (Babakus, Mangold 1989), bank (Cronin and Taylor
1992; Spreng and Singh 1993), business school placement center, tyre store,
dental school patient clinic and acute care hospital (Carman 1990), discount
and departmental stores (Finn and Lamb 1991; Teas 1993; Dabholkar et al.
1996) and others.

Parasuraman et al. (1994) suggest that service quality is a multifaceted

construct and no agreement exists as to the number of dimensions or their
interrelationships. Similarly, Bolton and Drew (1994) note that different
service dimensions are relevant in different industries, hence the need to
develop multiple scale items that adequately capture a particular study context.
Hence in order to accurately assess service quality in different industry settings,
modifications of the SERVQUAL scale may be warranted (Carman, 1990;
Dean,1999).

Although the Service Quality (SERVQUAL) instrument has been applied in the
study of service quality for many different types of services, it has been the
subject of a number of criticisms. For example, Reeves and Bednar (1994)
considered the strengths and weaknesses of Service Quality (SERVQUAL) and
related instruments. The issue of how best to conceptualize and operationalize

39
service quality is still a subject of heated debate (Cronin and Taylor,
1994;Parasuraman, Zeithaml and Berry, 1994; Teas, 1994). However, it is
generally agreed that service quality is a multi-dimensional or multi-attribute
construct (Cronin and Taylor, 1992; Parasuraman, Zeithaml and Berry,1988).
Some scholars have presented some questions about this scale yet, such as
Carman (1990) pointed out the SERVQUAL had good stability, but the five
factors are not neutral indicators for different service sectors, and isn’t
universally applicable. SERVQUAL fails to provide an accurate and effective
measure of service quality in retail settings such as discount stores, and apparel
specialty stores that offer a mix of goods and services. Also a wide variety of
empirical factor structures can be obtained. These factor structures vary in
terms of the number of interpretable factors, which consistently differ from the
five-factor structure proposed by Parasuraman, Zeithaml and Berry (1988;
1991). The considerable variation in empirical factor structures reported in the
literature raises doubts over the use of the SERVQUAL instrument in retail
research, much refinement was needed while applying SERVQUAL in specific
companies and industries. Similar concerns were voiced by Dabholkar, Thorpe
and Rentz (1996) when they noted that SERVQUAL which was developed
primarily to assess service quality for pure service environments, failed to
measure service quality for retail stores.

Although SERVQUAL is an excellent instrument for measuring service

quality, managers must be aware of potential problems with the instrument, as
well as with the gap theory methodology on which it is based. An
understanding of these problems may prevent service companies from
misinterpreting the results and developing inappropriate marketing plans. The
SERVQUAL instrument has three potential problems.

First, SERVQUAL measures customers’ expectations of the ideal firm in a

particular service industry. This may or may not be relevant to the capabilities
of a particular service firm or the set of service firms available to a consumer.

40
The second problem with SERVQUAL is its generic nature. Since it is not
industry specific, it does not measure variables that may be important for a
particular industry. For example, in the airline business, on-time arrival is a
very important dimension to travelers, but SERVQUAL does not measure
travelers’ perceptions of this variable.

The third problem with problem with SERVQUAL deals with the gap theory
methodology used for measuring the level of service quality. Measuring
consumer expectations after a service has been provided will bias consumer’s
responses. If customers had a positive experience at Blockbuster, they will tend
to report lower scores for their expectations, so there is a measurable gap
between what they expected and the actual service they received.

3.5.2 Service Performance Model (SERVPERF Model)

SERVPERF is the performance battery of SERVQUAL. Cronin and Taylor
(1992) developed a "performance-based" service quality measurement scale
called SERVPERF. The major difference between SERVQUAL and
SERVPERF is that SERVQUAL operationalizes service quality by comparing
the perceptions of the service received with expectations, while SERVPERF
maintains only the perceptions of service quality. The SERVPERF scale
consists of 22 perception items excluding any consideration of expectations.
The superiority of SERVPERF over SERVQUAL has been demonstrated in
numerous studies including those by Avkiran (1999), Lee et al. (2000) and
Brady et al. (2002). However, the continued use of and reference to
SERVQUAL in marketing literature suggest that “consensus has not yet been
reached relative to the superiority of performance - only measure of service
quality” (Brady et al. 2002).

Given the lack of theoretical support, Dabholkar, Thorpe and Rentz (1996)
used a triangulation of research techniques to discover the factor structure of
service quality. It consisted of phenomenological interviews with three retail
customers, exploratory in-depth interviews with six customers and a qualitative

41
study tracking the thought processes of three customers during an actual
shopping experience at a store. Combining these findings, they proposed a
hierarchical factor structure for retail service quality consisting of five
dimensions - Physical aspects, Reliability, Personal interaction, Problem
solving and Policy. These are also referred to as the second-order factors
because they comprised of several sub-dimensions. Each of the first three
dimensions has two sub-dimensions each. These six sub-dimensions, also
called the first-order factors which are labeled as Appearance, Convenience,
Promises, Doing-it-right, Inspiring confidence and Courteousness/helpfulness.

Figure 3.3
Subhash Mehta, Ashok Lalwani and Soon Li Han (2000) explored the
usefulness of Service Performance (SERVPERF), the perception component of
Service Quality (SERVQUAL) and retail service quality scale (the DTR scale)
in measuring the service quality of different product-service retail environment.
Result shows that the DTR scale was superior within the context of a “more
goods and less service” environment, i.e. a super market, while Service
Performance (SERVPERF) was better for a retailing context where the service
elements become more important i.e. an electronic good retailer. This modified
scale may show that the service quality of electronic goods retailer more

42
effectively than either the DTR scale or the Service Performance
(SERVPERF).

Chow and Luk (2005) revealed that among the five Service Performance
(SERVPERF) dimensions namely tangibility, reliability, responsiveness,
assurance and empathy, assurance was found to have the strongest positive
influence on customer satisfaction towards Fast Food Restaurants (FFR). The
fact that assurance has the strongest positive significance influence is
somewhat parallel with a prior study by Zhou (2004). However, the finding did
not corroborate with some studies such as Festus et al. (2006), and Landrum,
Prybutok, and Zhang (2006) who stated that other dimensions were more
dominant in predicting the customer satisfaction. These differing results could
be due to the different models used, industries or sampling applied and
conducted. These results also provided some useful practical implications. In
this respect, because employee expertise is an important component of overall
service quality (Tsai and Huang, 2002), it is a paramount importance for the
service providers of Fast Food Restaurants (FFR) to improve their assurance by
becoming more welcoming, courteous, knowledgeable and trustworthiness
during the servings or transactions. It is also important to improve employee
performance during their person-to-person encounters with customers, and this
area merits the attention of Fast Food Restaurants (FFR) managers because the
service encounter between customers and employees is an important factor of
customer satisfaction (Johns and Howard, 1998; Seidman, 2001). Furthermore,
there is a positive relationship between customer satisfaction and purchase
intensions. This result is congruent with the findings of Cronin and Taylor
(1992), Oliver (1993), Sprengand and MacKoy (1996), and Woodside, Frey,
and Daly (1989). The result suggested that service quality is an antecedent of
customer satisfaction and that customer satisfaction can influence more on
purchase intensions than service quality.

Regarding the service quality factors in retail banking, the important

discriminant factors among the private and public sector banks are

43
responsiveness and reliability whereas among the public sector and co-
operative banks, these are tangibles and assurance. In the case of private sector
and co-operative banks, these important discriminant factors are reliability and
responsiveness. The results indicate service quality of retail banking as critical
to customer’s satisfaction and these key areas provide important directions for
bank marketers to implement relationship marketing programmes. The
perceived service quality components namely reliability and responsiveness
have the most impact on customer’s satisfaction in retail banking.

Lau Pei Mey and Badaruddin Mohamed (2010) explored the service quality
attributes for evaluating perceived service quality of museums in serving
visitors. It developed a tool to assess the perceived service quality, satisfaction
levels, and behavioural intentions towards Malaysia’s museums, from the
visitor’s perspective, by applying the modified version of SERVPERF model
(Cronin & Taylor, 1992). Through the visitations to museums, discussions with
museums operators and researchers as well as the feedbacks from visitors
through the pilot study, 35 attributes that influencing visitors perceived service
quality towards the museum visit were identified. These included the service
dimensions starting from museum’s accessibility, information sources, quality
of displays/exhibitions, customer services, amenities and facilities, and ended
with pricing of souvenirs, food and beverages sold in a museum. Besides that,
items to examine visitor’s overall rating of the service quality, satisfaction
levels, as well as recommends the museum to others and their intension to
revisit a museum were also identified.

Hong Qin (2010) developed a FFR (fast food restaurants) success model in the
fast food industry in China. First of all, it posits an instrument to evaluate the
perceived service quality. And then, this instrument was empirically tested
using the data from a survey of college students who dine at fast food
restaurants in China. Both exploratory factor analysis and confirmatory factor
analysis were employed. The findings indicate that the modification of the
SERVPERF instrument in a specific setting in different cultures is necessary.

44
The significance of recoverability in this study supports the primary
modification of the SERVPERF instrument in the fast food industry. Assurance
and empathy were removed according to the results of exploratory factor
analysis in this study. It indicates that Chinese consumers may have unique
characteristics which are not captured by the SERVPERF scale. The result
suggests some managerial implications for fast food restaurant managers. First
of all, it is critical to provide reliable and responsive services for fast food
restaurants. Customer relationship management is important in China because
reliability and trust are prerequisite for the successful business. In addition, the
appealing physical facilities have a significant effect on customer’s perceptions
of the service quality in fast food restaurants.

3.5.3 Retail Service Quality Scale (RSQS)

Similar to and originating from the SERVPERF, the RSQS is a performance
based measure of service quality but specific to the retail context. Dabholkar,
Thorpe and Rentz (1996) proposed that retail service quality has a hierarchical
factor structure. While consumers think of retail service quality at three levels -
a dimensional level, an overall level, and a sub dimensional level, Dabholkar,
Thorpe and Rentz (1996) proposed five dimensions — physical aspects,
reliability, personal interaction, problem solving, and policy. They also gave
sub-dimensions of each dimension to combine related attributes into sub-
groups.

No Dimensions Definitions
1 Physical aspects Retail store appearance and store layout.
2 Reliability Retailers keep their promises and do the right things.
3 Personal Retail store personnel are courteous, helpful, and
interaction inspire confidence in customers.
4 Problem solving Retail store personnel are capable to handle returns
and exchanges, customer’s problems and complaints.
5 Policy Retail store’s policy on merchandise quality, parking,
operation hours, and credit cards.

45
The first dimension — physical aspects — encompasses the appearance of the
physical facilities and the convenience offered to the customer by the layout of
the physical facilities. Retail literature suggests that store appearance is
important to retail customers (e.g., Baker, Dhruv and Parasuraman, 1994). It
also suggests that customers value the convenience of shopping that physical
aspects such as store layout offer (Gutman and Alden, 1985; Hummel and
Savitt, 1988; Mazursky and Jacoby, 1985; Oliver, 1981). Therefore the sub-
dimensions of this dimension are appearance and convenience.

The second proposed dimension is reliability. It has two sub-dimensions and

other variations. Customers view reliability as a combination of keeping
promises (Dabholkar, Thorpe and Rentz, 1996). Westbrook (1981) found that
availability of merchandise is also a measure of reliability. So, the sub-
dimensions of reliability are promises and doing it right.

The third proposed dimension is personal interaction. It has two sub-

dimensions — service employees inspiring confidence and being
courteous/helpful. These sub-dimensions are very closely related and capture
how the customer is treated by the employee.

The fourth proposed dimension is problem solving which addresses the issues
of handling of goods returned and exchanges as well as complaints. Service
recovery is recognized as a critical part of good service (Hart, Heskett and
Sasser, 1990; Kelley and Davis, 1994). Recognizing and resolving problems
should emerge as a separate factor in customer evaluation. Westbrook (1981)
found that customers were quite sensitive to how service providers attend to
problems and complaints. Westbrook (1981) and Mazursky and Jacoby (1985)
also mention that the ease of returning and exchanging merchandise is very
important to retail customers. This dimension does not have any sub-
dimension.

The fifth proposed dimension — policy — captures aspects of service quality

that are directly influenced by store policy. For example, when customers

46
evaluate a store on the basis of convenient hours, it is viewed as whether the
store’s policy is responsive to customers’ needs. Westbrook (1981) and
Mazursky and Jacoby (1985) report that an important criterion on which
customers evaluate stores is the credit and charge account policies of the store.
Customers also appear to value parking availability for retail shopping (Oliver,
1981). This dimension does not have any sub-dimension.

RSQS has been used by some researchers in measuring service quality in

certain types of retailers such as department stores, supermarkets and discount
stores in Western and Eastern countries. Kim et al. (2001) conducted a study
with U.S. and Korean customers of discount stores. The findings showed that
customer’s perception of service quality do not view service quality in as
similar manner in U.S. and Korean customers of discount stores. In other
words, the dimensionality of service quality is not universal across industries or
across countries (Kim et al, 2001). Mehta et al (2000) conducted a research on
service quality in the contexts of super markets and electronic good retailers in
Singapore. The results showed that “RSQS was superior within the context of
more good and less service environment, i.e. a supermarket, while SERVPERF
was better for a retailing context where the service element becomes more
important, i.e. an electronic goods retailer”. (Mehta et al, 2000). Moreover, in
Vietnam, Nguyen (2006) tested a model on the relationships between service
quality, customer satisfaction and loyalty in supermarkets in HCMC and found
that retail service quality comprises of 5 dimensions: goods assortment,
personnel, appearance, physical aspects and safety.

Turley and Fugate (1992) as quoted by Tan and Mehta (1994) developed a
retail service quality scale (RSQS) and identified five dimensions associated
with facility intensive services (such as offered in supermarkets) as: 1)
operational dimension, 2) the location dimension, 3) the atmospheric and image
dimension, 4) the consumer use dimension and the 5) contact personnel
dimension. They contend that satisfaction with the facility driven service
usually depends on the customer’s ability to interact with the facility in order to

47
produce a satisfactory consumption experience. Writing on the same vein,
Strickland (2008) noted that customers have two levels of expectations: desired
and acceptable levels. She further advises that for an organization to achieve
the range between acceptable and desired, it has to establish: product and
service quality specifications, employee performance metrics, product
performance and quality metrics, clear definitions of customer expectations,
service process management, service process metrics, on-going interactive
customer orientation, iterative process monitoring, controls and corrective
action procedures.

Boshoff and Terblanche (1997) investigated the reliability and validity of the
RSQS in South African retail environment. Analysis of the data revealed that
the instrument was valid and reliable (Cronbach alpha values ranged from 0.68
to 0.90 for the five dimensions) measure of retail service quality in South
Africa. The instrument was found to be suitable for studying the service quality
of South African retail industry comprising of department stores, specialty
stores and hypermarkets that offered a mix of goods and services.

Mehta, Lalwani and Han (2000) explored the usefulness of RSQS as a tool for
measuring the service quality of different retail environments in Singapore. The
authors tested the reliability of the scale and found the Cronbach alpha values
to be ranging from 0.52 to 0.86 and 0.75 to 0.92 for the five dimensions of
RSQS in the context of supermarket and electronic goods retailers,
respectively. However, strong inter-correlation existed between the various
dimensions of the RSQS for both supermarket and electronic goods retailers.
For supermarkets, physical aspects and personal interaction were significant in
explaining the variance of the RSQS scale under stepwise regression, while the
dimension of Personal interaction alone was significant in contributing to the
overall variance for the RSQS scale for an electronic goods retailer. On the
basis of these findings, the authors finally concluded that the RSQS scale was a
better measure of service quality for a supermarket retailer than for an
electronic goods retailer.

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Kim and Jin (2002) point out that among the five dimensions of the RSQS,
Problem Solving and Policy were the only two new dimensions proposed by
Dabholkar et al. (1996), the rest being similar to SERVQUAL. In the study of
discount store customers in US and Korea (Kim and Jin 2002), and the study of
supermarket customers in Hong Kong (Siu and Chow 2003), the Problem
Solving dimension merged with Personal Interaction dimension, as customers
failed to distinguish between the two. The Policy dimension had to be dropped
in the study of discount store customers in US and Korea (Kim and Jin, 2002)
due to low item to total correlation. These findings call researchers to consider
whether RSQS (Dabholkar et al. 1996) provides an effective measure of service
quality for retail stores.

QIAN Liping, et al (2005) revised the RSQS for the Chinese consumer and
retail stores, considering the consumer characteristics and china cultural
background, they retained five dimensions of the original model, but the scale
items have been adjusted, the number of variables was reduced from 28 to 22,
of which 19 variables came from RSQS and added three new variables. Zhao
Hui (2007) introduced 24 variables in the paper "an empirical research on
Retail Service Quality Evaluation" for the case of supermarket service.

CHENG, SOO MAY (2007) tested the Chinese Retail Service Quality Scale
(CRSQS). This study has demonstrated the actual measurement of retail service
quality in Vietnamese supermarkets and considered the impact of retail service
quality on customers overall evaluation of retail service quality. In this respect,
this paper suggests certain managerial implications for supermarkets and their
managers in Vietnam. Firstly, service personnel are the key factor impacting
customer’s perception of service quality in super markets by improving the
performance of employees, supermarkets can increase customer’s satisfaction.
In addition, other factors that customers are concerned at supermarkets are
policy and physical aspects. Existing supermarkets and new/ potential entrants
to Vietnam must specify the weight of each factor impacting customer’s
perception of service quality. Based on these weights and the average score for

49
each factor, supermarkets can propose appropriate action plans. Secondly,
international retailers especially supermarkets which are about to come to do
business in Vietnam should be attentive when studying on retail service quality
in Vietnam so that they can focus on major dimensions and plan to meet the
customer’s expectations.

Jing Xiao and Jullia Chernetskaya (2010) measured retail service quality on
sport stores environment in Scandinavian market by applying and in the end
testing the RSQS model. Firstly, the data from the survey was collected using
the RSQS model. The RSQS validity and reliability issues which were found in
their study via factor and correlation analysis were aligned with the original
study carried out by Parasuraman et al. (1988). They found that the RSQS
model was a good instrument to measure retail service quality in sport stores.
RSQS model shows an overall perceived level of retail service quality in the
stores is equal that is less than expected level represents by number. This
means that customers are not fully satisfied with the retail service quality
provided in the Stadium sport outlets. Evidence from the study show that, sport
stores have to improve performance on all the dimensions of service quality in
order to increase customer satisfaction since consumers are not satisfied with
what is been offered by these stores. This will enable them to maintain high
level of competitiveness.

Leen and Ramayah (2011) in their study on ‘Validation of the RSQS in

Apparel Specialty Stores’ found that all the five dimensions: physical aspects,
reliability, personal interaction, problem solving and policy are highly suited
for measuring retail service quality in clothing stores. Retail service quality is
furthermore associated with future consumption behaviour in terms of the
customers intention to visit, purchase and recommend the stores to others.

Based on the above review, RSQS is employed in this empirical study of

service quality.

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 Table 3.1
Summary of Empirical Researches using
SERVQUAL, SERVPERF AND RSQS
Service Dimensions and
Researcher Year Key findings
Industry Attributes
Luca petruzze llis 1988 Bank customers Principal factor The results analyzed the
of south Italy analysis and switching cost of customers
SERVQUAL and encourage Customer
relationship management and
vendor relationship
management
Paulo A. Cauc 1988 Customers of Descriptive and The key value for customers
hick Miguel various service inferential are credibility and competence
industry in USA Statistics while for manager; reliability,
and SERVQUAL tangible and courtesy
Sanjay Gupta 1988 Consumers of ANOVA and The study confirmed that the
food restaurant regression SERVQUAL scale stands to
in India analysis provide more pragmatic
and SERVQUAL diagnostic of service quality
provision than SERVPERF
Soyoun & Kim 1988 U.S. and Korea Factor analysis The college students expressed
college students and SERVQUAL more favourable behavioural
intentions toward discount
stores and greater satisfaction
than their counterparts
Shashan k Mehra 1988 Customers of Independent In the case of apparel store,
Pantaloons and sample t-test and Pantaloon and Big Bazaar both
Big Bazaar in SERVQUAL have performed equally well
India on the Service Quality Scale
i.e. they don’t have any
significant difference in each
dimension or sub-dimension
J. Mark Munoz 1988 Retail store Principal The findings were that the
employees in component shopping experience influence
Philippines analysis and the service quality perception
SERVQUAL and expectation in Philippines
Carman 1990 Tyer retailing, Identified nine Five dimensions of
offering a mix factors of service SERVQUAL were not generic,
of merchandise quality and suggested that the
and services instrument be adapted by
adding new items or factors as
pertinent to different situations

51
 Service Dimensions and
Researcher Year Key findings
Industry Attributes
Finn and Lamb 1991 Department No such Confirmatory factor analysis
stores and dimension were was unable to provide a good
discount stores given by the fit to the proposed five-factor
researcher structure of SERVQUAL and
concluded that the instrument
could not be used as a valid
measure of service quality in
retail companies without
modification.
Babakus and 1992 Electric and gas Five dimensions The study found that the
Boller company of SERVQUAL proposed five-factor structure
of SERVQUAL was
problematic and doubted the
suitability of the SERVQUAL
scale for measuring quality
across a wide range of services.
Isabel B. 1992 Retail Bank Regression and Service quality, future
Cerchiaro Customers of factor analysis and purchase and customer
Brazil and UK SERVQUAL satisfaction are related.
Lau pie 1992 Visitors of Cross Sectional Overall satisfaction with
Mey museum in Comparison and visitors.
Malaysia SERVQUAL
Mass Hareeza 1992 Tax collector Reliability, The company should check and
Ali Government correlation, renovate their facilities and
regression and equipment. They should also
agencies in
factor provide training.
Malaysia
analysis and
SERVPERF
Hollis and victor 1992 Library System Polar extremes The study suggests and
Users in USA and regression examines difference between
analysis and polar means of two groups.
SERVQUAL
Dayang Nailul 1992 Customers Descriptive Three attributes; qualities
for hotel and inferential attribute of foods, service and
place/ambience have
Industry in statistics,
significant relation on
Malaysia SERVQUAL customer’s satisfaction. This
and result showed that although
SERVPERF perception of customers
towards food quality was low,
their satisfaction was still high.

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 Service Dimensions and
Researcher Year Key findings
Industry Attributes
Gagliano and 1994 Retail clothing Extracted four Original SERVQUAL scale
Hathcote Sector factors out of was not an effective tool for
which two have measuring service quality in
no correspondence apparel specialty stores.
to SERVQUAL
Vazquez, 1995 Investment Proposed a new 24 items were identified where
Rodriguez and Banker set of five 12 were from SERVQUAL and
Ruiz dimensions researcher added 12 new items.
Dabholkar 1996 Retail sector in RSQS Scale All the RSQS dimensions and
et al. U.S.A. sub dimensions were found to
be Valid.

Boshoff and 1997 Department Retained five RSQS found to be a valid and
Terblanche stores, speciality dimension of reliable measure of retail
stores and RSQS service quality.
hypermarkets in
South Africa
Durvasula et al. 1999 Various Confirmatory The fit of the SERVQUAL
organisations in Factor Analysis model was acceptable and
Singapore model provides the best
representation of the data.
Morales Espinoza 1999 Customers of Exploratory The SERVQUAL’s
Supermarkets in Factor Analysis dimensional structure was
Canada and and Confirmatory confirmed by the data.
Peru Factor Analysis
Mehta, Lalwani 2000 Electronic RSQS Scale RSQS scale was a better
and Han Goods Retailers measure of service quality for a
and supermarket retailer than for an
Supermarkets in electronic goods retailer.
Singapore
Fogarty, G., Catts, 2000 Four small retail No suggestion for Analysis suggested that the
R., and Forlin,C. businesses any new five factors can be treated as
within dimension five different stages of service
provincial cities quality, rather than as five
in South East qualitatively different
Queensland dimensions.
Siu and Cheung 2001 Departmental Six dimensions of Five factor structure of RSQS
store chain in RSQS could not be identified; instead
Hong Kong six service quality dimensions
emerged from the study.
Sureshchander, 2001 Retail stores in Some dimension Shoppers mentioned several
Rajendran and India and attributes service aspects, such as
Kamalnaben need to be ‘mailers sent by store’ and

53
 Service Dimensions and
Researcher Year Key findings
Industry Attributes
modified ‘loyalty programs’ as being
‘misssing’ from the scale.
Kim and Jin 2002 Discount stores Only three Five items designed to measure
in US and Korea dimension of service quality Policy found to
RSQS be unreliable in both countries.
Personal interaction and
Problem solving combined into
a single construct named
Personal attention. RSQS could
not be viewed as a reliable and
valid measure for cross-
cultural comparisons.
G.Sureshchander 2002 Banking sector Five dimensions The study found that the
et al. in India of SERVQUAL factors like service content,
service delivery and social
image which were not
addressed by SERVQUAL.
The results of the study may
not be applicable to all sectors
and there is a possibility of
cultural bias when applied to
countries other than India.
Zhou et al. 2002 Bank customers Exploratory Six dimensions for expectation
in China Factor Analysis scores; Personal attention,
Punctuality, Responsiveness,
Policy, Assurance and
Tangibles while three
dimensions for perception and
gap scores; Reliability,
Assurance and Tangibles are
highly suited for measuring
satisfaction of Bank customers.
Siu and Chow 2003 Supermarkets in Proposed new set Five items deleted due to low
Hong Kong of five dimensions Cronbach alpha values.
Problem Solving dimension as
given in the retail service
quality scale was integrated
into the Personal Interaction
construct while a new factor
emerged from the study, called
Trustworthiness.
Baldwin and 2003 Dental Care Exploratory Four dimensions for
Sohal Services Factor Analysis expectation and perception
Patients in scores; Skill and ability,
Australia Punctuality, Personal attention

54
 Service Dimensions and
Researcher Year Key findings
Industry Attributes
and Tangibles while Four
dimensions for gap scores;
Responsiveness, Empatic
assurance, Reliability and
Tangibles are perfectly suited
for Dental Care Services
Patients.
Kaul 2005 Specialty Service quality At the sub dimensions level, a
apparel has four four factor structure instead of
stores in India dimensions six factors was supported.
structure in Indian
retailing
Nguyen 2006 Supermarkets in Five dimensions Tested a model on the
Vietnam of RSQS relationships between service
quality, customer satisfaction
and loyalty.
Promita 2007 Kirana stores, A separate scale Customer patronage to grocery
Goswamiand supermarkets need to be stores was found to be
Mridula S. Mishra and developed for positively related to location,
hypermarkets kirana stores helpful and trustworthy
salespeople, home delivery,
cleanliness, offers, quality and
negatively related to travel
convenience. Kiranas do well
on location but poorly on
cleanliness, offers, quality of
goods and helpful trustworthy
sales people.
Sanjaraspor 2009 Customers of Exploratory Reliability, Empathy and
Hotel industry Factor Analysis competence of staff,
in Croatia Accessibility and Tangible are
fit for the data.
Gilmore, Audrey, 2010 Customers Exploratory SERVQUAL is reliable and
Mcmullan, perception on Factor Analysis valid and is adequate to
Rosalind tourist and Regression measure the quality of a tourist
destination in destination.
Spain
Jasmine Yeap Ai 2011 Specialty stores Purposive Found all five dimensions
Leen in Malaysia sampling method highly suited for measuring
and five retail service quality in
dimensions of clothing stores, Also proved
RSQS that the instrument was
applicable in the Malaysian
setting.

55
 Service Dimensions and
Researcher Year Key findings
Industry Attributes
Theodorakis et al. 2011 Football players Confirmatory Overall service quality was
in USA Factor Analysis shown to mediate the
relationship between the five
dimensions of service quality
and players satisfaction.
Quos Cuong 2011 Banking SERVPERF The results of the analysis
Nguyen, Sirion Industry in Model revealed that customer
Chaipoopirutana, Vietnam satisfaction displays a
Howard .Combs significant relationship to the
customers loyalty. The results
also found that consumers who
hold a positive attitude towards
the bank‘s image tend to
develop loyalty towards the
bank.
Mubarak Ali 2011 Customers of Exploratory Exploratory Factor Analysis
Bank in India Factor Analysis was considered a valid
and Regression instrument for the Indian
situation.
Swar 2012 Customers of Regression Human element of service
Bank in India Analysis delivery and systematic
element of service delivery
were highly related with each
other.

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